Select Page

Strategic concepts to remember

I’ve been trying to single out good strategies that have created new markets for emerging concepts/technologies, and now some patterns have started emerging. The following is a living list of what seems to make good sense:

  • Always think platform– A foundational approach to new products is perhaps key in breaching new markets. This is more about abstracting your value proposition so that others can build on top of it. Makes for a more sustainable market. Examples- iPhone (app store), Facebook (fb connect), Linkedin (apps), Microsoft Healthvault (peripheral medical devices), Google Health (personal health data), Ooyala (video syndication), WordPress/Typepad (blogging).
  • Foster an Ecosystem– This strategy is about growing the whole pie, rather than getting a bigger piece for yourself. Get partners and 3rd party providers to add value to your offering, and share revenue with them. Microsoft does it the best. Overlaps with the ‘platform’ approach somewhat because having an enabling foundation is key for ecosystem to develop. Examples- Healthvault (lining up numerous medical device vendors), Apple App Store.
  • Offer Service, not products– Consumers want risk-sharing and dependability. These are more amenable to a service model. SaaS, SOA are the central approaches here. Everything can be a service. Examples- RollsRoyce offering jet engines as a service, Salesforce (the SaaS pioneer, of course). Some people like to call this way of doing business as ‘solution-centric’ offerings, not services… but i think the core idea is the same.
  • ?

Overcapacity breeds innovation

I’ve been reading about this in multiple places- and since is a very interesting concept, wanted to collate it all in one place. This business observation states that excessive capacity in a given industry is often the much needed precursor to subsequent innovation. Examples are (still working on some of these):

  • Railroad expansion in 1800’s – led to the increase in trade
  • Industrial revolution led to large number of factories and overcapacity – ?
  • Massive fiber-optic cables laid down in dot com era lead to cheap connectivity
  • Surplus silicon and wafer cutting technologies after the semiconductor industry slowed down after dot com bust were picked up by a fast-growing solar energy industry
  • The downtime created by the collapse of the Internet bubble gave people spare cycles to think up of new applications that we now collectively know as Web 2.0